BA3

Chartered Institute of
Management Accountants

Chartered Institute of
Management Accountants

Chartered Institute of
FUNDAMENTALS OF FINANCIAL ACCOUNTING – 2017 SYLLABUS Management Accountants
The main objective of BA3 is to obtain practical understanding of financial accounting and the process behind the preparation of financial statements for
single entities. Therefore, the key areas covered in BA3 are as follows.
• Conceptual and regulatory framework (legislation and accounting standards) required to prepare financial statements.
• Developing an understanding of double-entry bookkeeping.
• Knowledge, understanding and application of controls in accounting systems.
• Measurement of financial performance through basic ratios.

A two-hour computer based assessment, comprising 60 compulsory objective test questions will be used to assess candidates of BA3. Short scenarios may
be given to which one or more objective test questions relate.
Refer page 27 of the 2017 Syllabus for the details in BA3, especially for the scope of knowledge and application of IFRSs and IASs.
This Transition Guide aims to answer questions such as:
• What in the BA3 syllabus mirrors that of in C02?
• What are the new topics in BA3?
• What topics remain the same (as in C02), but need a different approach in teaching (and learning)?
• What topics in C02 are no longer there in the BA3 syllabus?

FROM C02 TO BA3

Paper C02
BA3 Fundamentals of Financial Accounting
Fundamentals of Financial Accounting

Accounting Principles, concepts and regulations

A Conceptual and Regulatory Framework 20% A 10%
(reduced)

Recording Accounting Transactions

B Accounting Systems 20% B 50%
(plus additional content)

C Preparation of Accounts for Single Entities 45% C Preparation of Accounts for Single Entities 30%

Control of Accounting Systems Analysis of Financial Statements

D 15% D 10%
(part moved to BA4) (plus part of C03 section A)

• Greater emphasis on recording of accounting transactions, starting with source documents and the books of prime entry.
• Syllabus area B is the largest by study weighting, as it is fed into by areas of B, C and D of C02.

WHAT’S STAYING THE SAME IN BA3?

The content around the preparation of accounts of single entries (prepare financial statements from trial balance, prepare financial statements from
incomplete records, prepare a statement of cash flows) remains largely unchanged, with the exception of some changes in the wording of some
learning outcomes.
WHAT’S COMING IN TO BA3?

A Accounting Principles, concepts and regulations B Recording Accounting Transactions (syllabus weighting 50%)
(syllabus weighting 10%)

BA3 – A1 BA3 – B1
f. identify the need for and information to be included in an a. Prepare the books of prime entry
integrated report
BA3 – B3
BA3 – A1 a. calculate sales tax
g. describe the accounting equation b. prepare accounting entries for sales tax (from C02, B)
BA3 – A1 d. prepare accounting entries for the issue of shares (from C02, C)
h. explain the need for accounting codes (from C02, B)

C Preparation of Accounting for Single Entities D Analysis of Financial Statements (syllabus weighting 10%)
(syllabus weighting 30%)

None BA3 – D1
a. identify the information provided by the calculation of accounting
ratios
b. identify reasons for the changes in accounting ratios
(Note: ratios were in C02, but in BA3 the application of ratios
is emphasised)

WHAT IS UNCHANGED IN BA3 FROM C02 BUT WILL NEED A DIFFERENT APPROACH?

Component Learning Outcome

BA3 2017 C02 2011 Change

A1b Identify the needs of different user groups Identify user groups and characteristics of financial Learning outcome
statements reworded

A1c Distinguish between the purposes of financial Distinguish between Financial and Management Accounts Learning outcome
and management accounts reworded with an
emphasis on “purpose”

A2a Explain the influence of legislation and Explain the influence of legislation on published accounting Learning outcome
accounting standards on published accounting information for organization reworded (e.g. IASs,
information IFRSs)

B1b Apply the principles of double- entry Explain the purpose of double entry book keeping Verb level changed from
bookkeeping explain to apply

B1c Prepare nominal ledger accounts Prepare, nominal ledger accounts, journal entry and a trial Learning outcome
balance reworded

B1d Prepare the trial balance Prepare, nominal ledger accounts, journal entry and a trial Learning outcome
balance reworded

B3c Prepare accounting entries for payroll Prepare accounts for pay roll Learning outcome
reworded

C1a Prepare accounting entries for accruals and Prepare accounts using accruals and prepayments Learning outcome
prepayments reworded

C1b Prepare accounting entries for irrecoverable Prepare accounts for bad debts and allowances for Learning outcome
debts and allowances for receivables receivables reworded

C1c Prepare accounting entries for inventories Prepare accounts for inventories Learning outcome
reworded

C2a Prepare basic manufacturing accounts Prepare manufacturing accounts Learning outcome
reworded

C3b Prepare financial statements from incomplete Prepare accounts for incomplete records Learning outcome
records reworded
WHAT’S COME OUT OF C02?

Topic Where moved to

External Audit BA4 Syllabus Area B

Internal Audit BA4 Syllabus Area B

Nature of Fraud BA4 Syllabus Area B

WHAT’S THE KEY MESSAGE?

The purpose of this subject is to introduce financial accounting and the preparation of accounts. The regulatory framework and accounting standards
are introduced, and a ‘back to basics’ approach is employed to ensure double-entry bookkeeping is understood.

BA3 AND 2015 PROFESSIONAL LEVEL SYLLABUS

Operational level Management level Strategic level

BA3A Accounting F1A Regulatory Environment for F3A Formulation of Financial

Principles Concepts and Financial Reporting Strategy
regulations
F1B Financial Accounting and
Reporting

BA3B Recording F1B Financial Accounting and

Accounting Transactions Reporting

BA3C Preparation of F1B Financial Accounting and F2B Financial Reporting

Accounts for Single Reporting
Entities

BA3D Analysis of F1C Management of Working F2C Analysis of Financial F3A Formulation of Financial
Financial Statements Capital, Cash and Sources of Performance and Position Strategy
Short-Term Finance
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Management Accountants
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